What is price difference in SAP CO-PC - Product Cost Controlling?

SAP Term: price difference

• Component: CO-PC

• Component Name: Product Cost Controlling

• Description: The difference between the valuation price of a material and the price used for a movement with an external amount. If the material ledger is active, price differences are collected in price difference accounts regardless of the setting of the price control indicator in the material's master record. If the price control indicator for the material is set to V, these price differences are reposted to the corresponding material inventory accounts during material price determination if stock coverage is sufficient. These postings are proportional to the quantity on which the price differences are based.

Smart SAP Assistant

• Key Concepts: 
  Price difference is a term used in SAP's CO-PC Product Cost Controlling component. It is the difference between the planned and actual price of a product or service. This difference can be either positive or negative, and it is used to determine the profitability of a product or service. 
  
  How to use it: 
  In order to calculate the price difference, you must first determine the planned price of the product or service. This can be done by looking at the budgeted cost for the product or service. Once you have determined the planned price, you must then calculate the actual price of the product or service. This can be done by looking at the actual cost incurred for producing or providing the product or service. Finally, you must subtract the planned price from the actual price to determine the price difference. 
  
  Tips & Tricks: 
  When calculating the price difference, it is important to take into account any additional costs that may have been incurred in producing or providing the product or service. These additional costs can include taxes, shipping fees, and other miscellaneous expenses. Additionally, it is important to remember that a positive price difference indicates that a product or service was profitable, while a negative price difference indicates that it was not profitable. 
  
  Related Information: 
  The concept of price difference is closely related to other concepts in SAP's CO-PC Product Cost Controlling component, such as cost variance and cost absorption. Cost variance is used to measure how much actual costs differ from budgeted costs, while cost absorption is used to measure how much of a product's cost is absorbed by its sales revenue. Understanding these concepts can help you better understand how to use price difference in SAP's CO-PC Product Cost Controlling component.